Correlation Between Brilliant Earth and Victorias Secret
Can any of the company-specific risk be diversified away by investing in both Brilliant Earth and Victorias Secret at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Brilliant Earth and Victorias Secret into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brilliant Earth Group and Victorias Secret Co, you can compare the effects of market volatilities on Brilliant Earth and Victorias Secret and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Brilliant Earth with a short position of Victorias Secret. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brilliant Earth and Victorias Secret.
Diversification Opportunities for Brilliant Earth and Victorias Secret
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Brilliant and Victorias is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Brilliant Earth Group and Victorias Secret Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Victorias Secret and Brilliant Earth is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Brilliant Earth Group are associated (or correlated) with Victorias Secret. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Victorias Secret has no effect on the direction of Brilliant Earth i.e., Brilliant Earth and Victorias Secret go up and down completely randomly.
Pair Corralation between Brilliant Earth and Victorias Secret
Given the investment horizon of 90 days Brilliant Earth is expected to generate 1.68 times less return on investment than Victorias Secret. In addition to that, Brilliant Earth is 1.61 times more volatile than Victorias Secret Co. It trades about 0.15 of its total potential returns per unit of risk. Victorias Secret Co is currently generating about 0.4 per unit of volatility. If you would invest 3,151 in Victorias Secret Co on September 2, 2024 and sell it today you would earn a total of 733.00 from holding Victorias Secret Co or generate 23.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Brilliant Earth Group vs. Victorias Secret Co
Performance |
| Timeline |
| Brilliant Earth Group |
| Victorias Secret |
Brilliant Earth and Victorias Secret Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brilliant Earth and Victorias Secret
The main advantage of trading using opposite Brilliant Earth and Victorias Secret positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brilliant Earth position performs unexpectedly, Victorias Secret can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Victorias Secret will offset losses from the drop in Victorias Secret's long position.| Brilliant Earth vs. Capri Holdings | Brilliant Earth vs. Movado Group | Brilliant Earth vs. Tapestry | Brilliant Earth vs. TheRealReal |
| Victorias Secret vs. Ross Stores | Victorias Secret vs. Childrens Place | Victorias Secret vs. Buckle Inc | Victorias Secret vs. Guess Inc |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |